Maruti Suzuki price hike takes effect; shares rise

Maruti Suzuki India shares were in high demand on Dalal Street after a price hike announced by the auto major earlier took effect on Tuesday, January 16. The stock of the auto major—whose popular cars include Baleno, Swift, WagonR, Brezza and Ertiga—gained by as much as Rs 154.7, or 1.5 per cent, to Rs 10,241.2 apiece on BSE, rising for a second straight session. 

In a regulatory filing on Tuesday, the company said the estimated weighted average increase across its models stood at around 0.45 per cent, an indicative figure calculated using ex-showroom prices of models in the national capital.

The auto major had first notified the hike across its model range in November last year, citing increased cost pressure driven by overall inflation and increased commodity prices. "While the Company makes maximum efforts to reduce cost and offset the increase, it may have to pass on some increase to the market," it had said.  

The development comes at a time Dalal Street investors are eagerly tracking the first leg of earnings for cues as India Inc entered a fresh results season last week.  

Maruti Suzuki India is yet to announce the date it will release its financial results for the December quarter.  

What to expect from Maruti Suzuki in Q3 

According to Prabhudas Lilladher, Maruti Suzuki India is estimated to register 14.2 per cent year-on-year growth in revenue for the October-December period, driven by improved volumes and higher realisations owing to price hikes and a richer product mix. It expects the auto major's net profit to increase 35.6 per cent and EBITDA margin to improve by 122 basis points compared with the year-ago period. 

The brokerage has a 'buy' rating on Maruti Suzuki with a target of Rs 12,100 per share. It has Maruti Suzuki among its top picks in the auto space, besides Tata Motors. 

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Maruti Suzuki India shares: Past performance

The Maruti Suzuki stock has grown 22 per cent in the past year, in line with a 23 per cent gain in the headline Nifty50 index.

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